Brent fell as low as $60.56/bbl on 12th June after successive US inventory builds and concerns over the global economy, before recovering above $65/bbl as tensions between Iran and the US flared. Donald Trump and Xi Jinping will meet at the G20 with hopes that trade talks will progress. We have trimmed our Brent 2019 forecast to $70/bbl (-$2.28/bbl on previous), as economic indicators continue to worsen. Our global demand growth forecast for 2019 is also revised down to 1.26 million b/d (-130,000 b/d m-o-m) for the same reason. Nevertheless, positioning risk has played out, with money managers now almost as net short as they were in January, making the market more dependent on the direction of the next catalyst. Our global supply growth forecast for 2019 is 850,000 b/d (-150,000 b/d), led by the US (+1.1 million b/d) but offset by an increased OPEC decline (-920,000 b/d). OPEC compliance with the Vienna Group deal held at 146% in May, but Iranian and Venezuelan production may be c. 700,000 b/d higher than reported in total. We continue to expect the Group to roll over its production deal, but now see less production being added back post-renewal, given the lower price environment and apparent ample supply....

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